Fund in Focus: Loomis Strategic Income

This fixed income fund has been awarded a Gold Rating by Morningstar analysts who are impressed by the management team and the performance

Mara Dobrescu 24 September, 2014 | 12:09PM

During early 2014, Loomis Sayles Strategic Income Fund managers grew increasingly cautious. Co-manager Elaine Stokes argued that while corporate-bond valuations were consistent with the late stages of a business cycle, absolute yields left little upside, and financial markets had been overly complacent about geopolitical risks.

This fund has plenty of charms

To provide a cushion, and dry powder should riskier credits sell off, the team added exposure to short-term Treasuries sitting at 19.3% in July 2014, up from 6% in late 2013. In addition to being cautious on credit, the fund also continued to dial down interest-rate risk by reducing its average duration.

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About Author

Mara Dobrescu

Mara Dobrescu  is a fund analyst at Morningstar France.

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